Marie Noelle Duquenne, Dimitris Kallioras (p), Stavroula Vafeiadou

Fueling the relative academic debate and providing insight to the evaluation of the relative policies, the evolution of regional inequalities is an issue of utmost importance. Hence, the study of regional inequalities - in particular, the study of regional convergence / divergence - is at the heart of regional science. Intuitively, regional convergence suggests a process whereby poor(er) regional economies catch-up to rich(er) ones. Thus, from a policy point of view, the study of regional convergence / divergence may interpret as a sign with respect to the evaluation of the effectiveness and the efficiency of the implemented regional policy mix. Under similar reasoning, from a theoretical point of view, the study of regional convergence / divergence may serve as an empirical exercise with respect to the affirmation of regional development theories.
Σ-convergence is a dominant concept in the regional convergence / divergence literature and refers to the diachronic decrease of the overall dispersion of a regional dataset. Σ-convergence may apprehend through the coefficient of variation (CV) and the weighted coefficient of variation (CVw) formulas. CV is a standardized (relative) measure of dispersion and may express as the ratio of the standard deviation of a regional dataset to the corresponding mean. Including a weighting factor in the CV formula, so as to account for the corresponding relative regional size in the treatment of the regional dataset, allows for the compilation of the CVw, the weighted CV counterpart.
The paper revisits the σ-convergence concept and expresses the CV and the CVw formulas against the backdrop of the weighted mean and the median. Such an endeavor stems from both a statistical (the mean is sensitive to outliers) and a conceptual (the mean is never perceived as the benchmark for defining thresholds) rationale. The theoretical propositions of the paper are supported from an illustrative empirical analysis of regional for each EU country. It comes that different versions of the CV and the CVw may lead to different inferences with respect to regional inequalities.

Pietro Pizzuto (p), Fabio Mazzola (p)

The paper aims at investigating the impact of the Great Recession on per-capita GDP convergence process among 268 European regions and 28 countries, making direct comparisons between the two spatial levels.
To reach this goal, for the period 2000-2014, we apply the time-varying factor model developed by Phillips and Sul (2007, 2009), which allows for individual and transitional heterogeneity and convergence clubs identification. Also, we make use of a recent algorithm developed by von Lyncker and Thoennessen (2016) to test the robustness of our results.
Unlike the traditional neoclassical model à la Solow that assumes homogeneous technological progress, the approach proposed by Phillips and Sul allows for heterogeneity in technology growth rates and in the speed of convergence. In addition, unlike other approaches in which economies are grouped a priori, this methodology enables the endogenous determination of convergence clubs.
Starting from the identification of convergence clubs, the paper provides further evidence to the common belief of a “multi-speed” Europe by comparing Eastern European countries and regions, with the original European economies. In addition, by analysing the relative transition path of each club we detect strong evidence of divergence after the Great Recession between the highest and the lowest regional convergence clubs, and a slowdown in country club convergence.
Since the period under consideration follows the introduction of the Euro, the paper also investigates the evolution of the convergence process after the monetary unification implicitly testing the robustness of the results to the sample composition (inclusion or exclusion of the poorest countries). In this case, the findings are even clearer, suggesting a somewhat mild evidence of convergence among the lowest and the middle clubs at the beginning of the millennium, which slowed down over time turning into divergence after 2008.

Giorgio Fazio (p), Marco Modica, Pascal Mossay

Before the adoption of the Euro, while most recognised that the Eurozone would not have satisfied the optimal currency area criteria in the presence of asymmetric shocks, disagreement remained around the effects of greater integration. According to the European Commission, increasing integration would have led to the greater vertical integration of production and greater intra/industry trade, increasing cross/country business cycle correlation and reducing asymmetric shocks. In line with the predictions of the new economic geography, as proposed by Krugman (1991, 1993), instead, a reduction in transaction costs and greater economic integration would have led to more spatial concentration and therefore, even more, asymmetries, especially within countries.
In light of the current debate on the Euro and the possibility of a “two-speed” Europe, a better understanding of how integration has affected spatial concentration in Europe can be of great importance. Several years after the official adoption of the single currency, we should now be in a position to evaluate whether economic integration has, indeed, led to more or less spatial concentration.
To this end, in this paper, we propose a simple empirical exercise to investigate this issue. Specifically, we exploit a simple test of the growth distribution of the cities of the Eurozone members before and after the adoption of the single currency. Our results seem to suggest the emergence of an urban core-periphery structure within the Eurozone in the first decade from the introduction of the Euro.